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5 best penny stocks in steel sector for 2024

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Published Date: 09 Jul 2024Updated Date: 27 Dec 20246 mins readBy MOFSL

Introduction

Steel has an omnipresence in the Indian economy. All major industries, including machinery, construction, automobiles, etc., remain dependent on this metal. It is in demand as a raw material and a semi-finished product based on manufacturing needs. Steel has contributed immensely to India's development as the second-largest producer. 

The government is also encouraging the continued growth of the steel sector with schemes and supporting campaigns like 'Make in India'. Thanks to such measures, many companies have emerged in this industry over the years.

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If you want to cash in on the growth opportunities the steel sector in India presents but want to make smaller investments, penny stocks are the answer. With penny stocks, you can trade at a low price, commonly under Rs. 10 per share. Let's uncover the best penny stocks to buy in the Indian share market

Best Indian penny stocks to invest in 2024

Below is a list of the top five steel sector penny stocks in India for you to invest in:

  • Chaman Metallics Ltd

Under the GR Group, Chaman Metallics Ltd has grown to rank among the fastest-growing steel manufacturers in India. The conglomerate started with only a steel rolling mill, which has now branched into various products. Currently, it stands as a large producer of Sponge Iron, a key raw material for producing high-quality steel. Other products in development include ferro alloys, cast iron, MS ingot, re-rolled products & SGCI inserts, etc.

The company's share price on 1st July 2024 was Rs. 68.50. The market capitalisation was 160.32 crore, with an earnings per share of Rs. 5.19 and a P/E ratio of 12.72.

  • NMDC Steel Ltd

The Ministry of Steel and the Indian government authorise NMDC Steel Limited's operations. The company manufactures top-notch quality hot-rolled steel. This category of steel meets the requirements of various consuming sectors. It rolls out HR steel of 1650mm, making it the widest mill in the public sector. This company's MTPA steel plant also boosts iron ore supply. Besides these metals, the company also manufactures copper, limestone, tungsten, and other in-demand materials.

NMDC Steel Ltd recorded a share price of Rs. 57.66 on 1st July 2024. Its market capitalisation was 16,902. It maintained an earnings per share and P/E ratio of 0 for the trailing twelve months.

  • SAL Steel

SAL Steel is operated in Gujarat. Its plant is based in the Kandla Port, where it produces versatile steel varieties. The product range explored by the company includes the Direct Reduced Iron, also known as Sponge Iron. It also produces iron ore pellets, ferroalloys, and other finished products in steel. Besides self-producing, the company has tied up with reputed suppliers for raw materials to boost its functionality.

SAL Steel's share price on 1st July 2024 was Rs. 21.11. The market capitalisation reached 195.20, while the earnings per share was Rs. 0.06 and P/E ratio was 387.67.

  • Rama Steel Tubes Ltd

Rama Steel Tubes Ltd is one of the prominent steel pipes and tube manufacturers in India. It also deals in products such as rigid PVC, galvanised iron pipes, etc. The products are used in multiple industries, including real estate, furniture, infrastructure, and automobiles. The company prioritises adherence to accurate and superior quality standards. It has established a presence India and global markets.

Rama Steel Tubes Ltd.'s share price on 1st July 2024 was Rs. 11.40. Its market capitalisation was at 1702.30. The Profit/Earnings ratio came at 76.4, and the earnings per share was recorded at Rs. 0.15.

Penny Stock to buy in 2024

  • Llyods Engineering Works Ltd

Formerly known as Llyods Steel Industries Ltd, Llyods Engineering Works Ltd has now revamped its operations and image. It mainly started as a steel business, slowly transitioning into other industries. Today, besides steel plants, it provides engineering solutions to diverse product segments like HydroCarbon, power plants, oil & gas, nuclear power, refineries, and more. The wide range of solutions allows it to capture a larger market share.

Lloyds Engineering Works Ltd.'s share price was Rs. 71.94 on 1st July 2024. Its market capitalisation was 7992.20 with a P/E ratio of 100.64 and an earnings per share at Rs. 0.70.

Conclusion 

Given the irreplaceable role of the steel sector in the Indian economy, it is a growing avenue for investment. Penny stocks make your journey all the more convenient with the limited capital required for trading. However, they bear equal risks due to the high impact of market fluctuations. Thus, it is advisable to research the steel sector to sort out the best penny stocks to buy. You can refer to the list above and investigate these companies.

 

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Disclaimer: The stocks, companies, or financial instruments mentioned in this blog are for informational purposes only and should not be considered as investment recommendations. It is advised to consult with your financial advisor before making any investment decisions. Investment in securities markets are subject to market risks, read all the related documents carefully before investing. Investors are strongly encouraged to carefully read the risk disclosure documents prior to participating in market-related investments or trading activities. Due to the volatile nature of financial markets, no guarantees can be made regarding investment returns. Motilal Oswal Financial Services Ltd. does not offer any assured returns on market-linked securities. Please note that past performance of stocks or indices is not indicative of future results.
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